Peripheral artery disease (PAD) causes substantial morbidity and mortality but has few effective treatments. Strategies to promote angiogenesis for the treatment of PAD have met with little success, which has led to the investigation of stem cell-based interventions. Beneficial effects of cell-based approaches are generally thought to result from accessory effects, such as the local secretion of vascular growth factors, although less is known about whether resident muscle progenitor cells in ischemic muscle can differentiate into new blood vessels and how this can be achieved. Preliminary studies in our lab have demonstrated that the co-chaperone protein Bag3 plays an important role in the protection of muscle tissue from ischemia. Bag3 is known to play an important role in muscle, as loss of Bag3 in mice results in a fulminant myopathy, and mutation in human BAG3 has been linked to inherited cardiomyopathies. We investigated Bag3's effects in limb ischemia after it was identified as a component of the limb survival (Lsq1) quantitative trait locus (QTL). In addition t effects on muscle cells, we unexpectedly found that exogenous muscle-specific expression of Bag3 with adeno-associated virus (AAV6) induced a dramatic increase in angiogenesis in non-ischemic and ischemic muscle. Moreover, Bag3 expression in muscle significantly increased vascular maturation, as evidenced by smooth muscle actin (SMA)-positive vessels. Bag3 induced an increase in Pax7+ progenitor cells, which stained positive for SMA and CD31, suggesting that Bag3 induced an increase in vascular progenitor cells. Muscle contains a relatively large number of Pax7+ progenitor cells, which play an important role in postnatal muscle regeneration through hyperplasia but not hypertrophy. Evidence has linked Pax7+ progenitor cells to both endothelial and pericyte lineages. Based on these observations, we hypothesize that expression of Bag3 in muscle drives differentiation of Pax7+ cells into vascular cells, which may provide a source of endogenous vascular stem cells for the treatment of PAD. To test this hypothesis, the Specific Aims of this proposal are to: 1) Determine whether Pax7+ muscle progenitor cells can differentiate into endothelial or peri- endothelial cells after exogenous expression of Bag3 in skeletal muscle cells in vivo or in vitro; and 2) Determine whether Pax7+ cells are required for angiogenesis and vascular maturation after Bag3 expression in skeletal muscle in vivo. This exploratory R21 proposal is submitted in response to PA-09-248, Directed Stem Cell Differentiation for Cell-Based Therapies for Heart, Lung, and Blood Diseases, with the goal of determining the effects of skeletal muscle-specific Bag3 expression on the differentiation of Pax7+ progenitor cells into vascular cells as a potential treatment for PAD. Accomplishing the Specific Aims of this proposal will provide important insights into the mechanisms of muscle stem cell differentiation and crosstalk between blood vessels and muscle cells in skeletal muscle tissue. Furthermore, these studies may lead to effective therapies for the treatment of PAD.